| When selecting a third party logistics provider (3PL) | | | | A non-asset based provider does not own their own |
| you should consider the many options in front of you. | | | | equipment but serves as a third party (or broker) to |
| There are two different types of 3PLs and knowing | | | | arrange the transportation of your freight. Because a |
| the pros and cons of each will help you select a | | | | non-asset based provider does not need to fulfill the |
| provider that will best benefit your company. | | | | needs of their own assets, they can keep your best |
| The two types of 3PLs include asset based and | | | | interest in mind and find the best fit for your company. |
| non-asset based. While both options will get your | | | | Typically a non-asset based provider has a large |
| freight from point A to point B, there are many | | | | database of carrier contacts all across the country, |
| important differences between the two. | | | | offering a more flexible and efficient solution than a |
| Asset Based Providers | | | | pre-routed provider. |
| An asset based provider owns and operates their | | | | A non asset based broker offers their expertise in |
| own equipment whether it is trucks, warehouses, or rail. | | | | transportation and provides total, quality, logistics |
| They are working to find freight to cover their assets. | | | | evaluation, often providing higher service and |
| Any freight they receive is typically routed in the way | | | | technology solutions to assist in your supply chain |
| that best suits the provider's needs in order to get their | | | | effectiveness. Because a non-asset based provider |
| truck where it needs to be. | | | | works with other suppliers you can often benefit from |
| While asset based providers can offer slightly lower | | | | the value added services of each company while both |
| rates by directly providing the truck, they can be limited | | | | providers keep their individual investments low, granting |
| by fleet size, equipment type, or lanes. If your shipping | | | | greater financial security for all parties. |
| schedule does not fit into the pre-routed lanes from | | | | For many companies sorting through the thousands of |
| the asset based companies it may affect your | | | | trucking companies to find a reliable carrier is hard and |
| appointment schedules or on time percent. | | | | often deceiving work. When working with a non asset |
| An asset based provider should be extremely | | | | based provider who ships thousands of truckload |
| knowledgeable in their equipment and the lanes they | | | | shipments each year they will know which carriers are |
| cover, however their knowledge may only cover their | | | | reliable, and which are not. So if you are looking for |
| assets, and those assets may not be the best option | | | | one time coverage or an ongoing provider a non asset |
| for your business. | | | | based broker can offer industry expertise and reliable |
| These companies have higher operating costs and | | | | service. |
| can easily find themselves in financial trouble if their | | | | When choosing a service provider for your |
| rates cannot cover the changes in the market. If they | | | | transportation needs, there are many qualities to |
| are not utilizing all assets, they must reflect more | | | | assess and review before making a decision. While |
| operating expenses in their individual rates. When | | | | each provider is slightly different, knowing what they |
| working with an asset based provider you will feel the | | | | offer and their corporate mission will help you make an |
| market changes more directly due to the lack of | | | | informed decision. The most important thing to keep in |
| cushion a non-asset based provider can offer. | | | | mind is your company's goals and assess what the |
| Non-Asset Based Providers | | | | best solution is for your needs. |